Couldn’t happen to a nicer bunch of crooks
Oracle is underwater on its $300B OpenAI deal
131–140 of 194 posts
Re: Oracle is underwater on its $300B OpenAI deal
#132Earlier quoted context omitted.
The market is pricing in significant counterparty risk. It's possible Oracle does the buying, unpacking, and cooling of Nvidia servers and doesn't get paid.
> It's possible Oracle does the buying, unpacking, and cooling of Nvidia servers and doesn't get paid. The beauty of being a cloud infra provider is you're selling shovels. OpenAI going bust? Doesn't matter too much for Oracle, there will always be someone willing to pay them for GPU compute capacity. Even if the hype behind AI dies down, which I hope it does rather sooner than later, the fundamental aspects aren't v…
> there will always be someone willing to pay them for GPU compute capacity.
There is an hourglass shape to emerging technologies. Everyone uses commodity hardware and duct tape to try to win the race to the bottleneck, where everyone save 2 companies goes bankrupt. As it narrows companies have learned enough about the problem to start developing purpose built solutions. Once you pass the bottleneck enough of your engineers go to other companies that the custom solution becomes mainstream and competition grows again.
Google was working on custom chips for AI before we knew it was AI. They are going to survive either as the dominant player in AI or as the underlying platform everyone else builds on.
That leaves one other spot for everyone else racing to the eye of the needle. Anyone betting on Oracle to win on technology is silly, betting on Oracle with a bunch of generic GPUs that anyone can get is down right dumb.
Re: Oracle is underwater on its $300B OpenAI deal
#133Earlier quoted context omitted.
> It's possible Oracle does the buying, unpacking, and cooling of Nvidia servers and doesn't get paid. The beauty of being a cloud infra provider is you're selling shovels. OpenAI going bust? Doesn't matter too much for Oracle, there will always be someone willing to pay them for GPU compute capacity. Even if the hype behind AI dies down, which I hope it does rather sooner than later, the fundamental aspects aren't v…
> AI, even the relatively lackluster state we have today, has a ton of very useful usage cases that are actually working in the field. Useful use cases at what price ? It's totally possible that after VC money dries up the price increases far beyond what customers (both business and consumer) have been paying, resulting in demand destruction rendering the investment a net negative for Oracle.
Not nessesarily. We have providers of hosted oss models (even large sota ones), with competitive API pricing. They have no reason to subsidice their services, outside og initial market grab. But there is so many of them that it dosent look to bad.
Also buisnisses have invested to host things locally themselves as well.
Re: Oracle is underwater on its $300B OpenAI deal
#134The market (over)reacted to the OpenAi announcement sending Oracle’s share price up and now may be overreacting to Altman’s interview with an investor pushing their stock price down. And we are measuring (what seems like) a non-binding investment against market cap which swings everyday.
Is it just me, our does this feel like the AI grifters doing the same market manipulation tricks that their new best friends (or their past selves) the Crypto Currency grifters used, only this time with private company stock price insane valuation deals instead of magical internet money beans?
Re: Oracle is underwater on its $300B OpenAI deal
#135Re: Oracle is underwater on its $300B OpenAI deal
#136Re: Oracle is underwater on its $300B OpenAI deal
#137Earlier quoted context omitted.
The market is pricing in significant counterparty risk. It's possible Oracle does the buying, unpacking, and cooling of Nvidia servers and doesn't get paid.
> It's possible Oracle does the buying, unpacking, and cooling of Nvidia servers and doesn't get paid. The beauty of being a cloud infra provider is you're selling shovels. OpenAI going bust? Doesn't matter too much for Oracle, there will always be someone willing to pay them for GPU compute capacity. Even if the hype behind AI dies down, which I hope it does rather sooner than later, the fundamental aspects aren't v…
What happens if you've got $300B worth of shovels but can only realistically rent them out for $5B/yr?
Nortel was a shovel maker selling shovels to ISPs.
Re: Oracle is underwater on its $300B OpenAI deal
#138Since QE and Zirp and then Covid stimulus money stopped making sense. It is fucking too much money in a few hands.
Re: Oracle is underwater on its $300B OpenAI deal
#139Earlier quoted context omitted.
[flagged]
Please stop. This kind of rage-posting is not what HN is for. It's fine to think whatever you want about Mr Ellison or any other tech luminaries, and criticize them for whatever you like. But commenting in this style does nothing to harm Ellison, whilst making HN a dismal place for your fellow community members who do actually read what you post.
For me it was a joke. But it wouldn't be the first time something like that happens.
I will take your advice with good will. thanks.
Re: Oracle is underwater on its $300B OpenAI deal
#140Earlier quoted context omitted.
Time to put your RRSP / 401k in cash, it's all starting to seriously teeter.
Well, bonds should be OK. CDs, Treasuries, etc
This used to be the case, but bonds have been positively correlated with stocks in recent years, so they have not been an effective hedge. Additionally, it seems possible/likely that we are headed into the long-predicted COVID stagflation, where growth is slow, so interest rates are low, but inflation remains high, which makes bonds unappealing.